Student loan debt in the U.S. is at an all-time high at $1.47 trillion and continues to climb. Rising costs of earning a college degree will impact financial and personal decisions.

Student loan debt in the U.S. is at an all-time high at $1.47 trillion and continues to climb. As the average student loan balances increases, the effects of debt will as well. Find out how the rising costs of earning a college degree can affect financial and personal decisions for the next decade.

Key Stats of Student Loan Debt in the U.S.

As the infographic shows, student loan debt is a looming issue that continues to grow at a rate of $3,000 per second! By this time tomorrow, the total balance will be $259 million larger.

In addition to the rapid growth rate, here are four additional key facts you need to know about student loan debt:

The typical 2016 college graduate has $37,000 in student loan debt to repay

By the ending of 2017, the national total will reach $1.5 trillion

It takes the average graduate 10 years to repay their student loans

The average monthly payment is $350

Prior to the Great Recession, student loan debt was only $600 million

Student loans are the second-most prevalent form of personal debt in the U.S. Only home mortgage loans are more common today. Before the Great Recession, student loan debt was the 4th most common type of debt and trailed home mortgage loans, credit card debt, and auto loans.

Why Does Student Loan Debt Continue to Increase?

So you might be wondering why student loan debt is so high?

There are several factors have contributed to the sharp increase. Higher interest rates, rising tuition costs, and larger enrollment are some key factors. More high school graduates opt for a college degree instead directly entering the workforce.

To help put the student loan debt increase into perspective, these are a few numbers:

Tuition has increased 275% from 1970 to 2013

There are 20.5 million college students –that’s 5.2 million more students than in 2000

Subscribe and get our daily emails and follow us on social media.

By opting in, you agree to receive emails with the latest in Lifestyle + Entertainment from TellMeNow. Your information will not be shared with or sold to 3rd parties.

As more students attend college, that means higher demand for student loans. More borrowers submitting loan applications are automatically going to cause the total loan balance to increase.

As interest rates have risen since the Great Recession ended, new student loans are going to accrue interest quicker than older student loans with a lower interest rate. By coupling higher interest rates with larger loan balances, it shouldn’t be a surprise that a student in 2017 is going to pay more interest each month than a college student in 2013.

More Students Are Earning Advanced Degrees

Since the Great Recession, more student are pursuing a gradaute degree to be more competitive in the job market. As a result, they need to borrow more money and some degree programs cost more than $100,000!

A medicine degree can easily cost $161,800 and a law degree can cost $140,600. The average debt balance for a four-year degree from a public university is only $26,900.

While some of the most lucrative college degrees require an advanced degree, the additional schooling (and borrowing costs) might not always be the best return on investment.

Personal Impact of High Student Loan Debt

High student loan debt balances are impacting personal decisions of graduates beyond what school they attend or the degree program to pursue.

Research indicates college graduates have made the following personal decision based on their student loan debt:

62% have delayed saving for retirement and other investments

Student loans have impacted more than 50% of borrowers from making larger purchases like vehicles and home mortgages.

As you can see, student loans are not only affecting the current budgets of students and recent graduates, student loans are also negatively affecting future life events like starting a family, buying a home, and saving for retirement.

Current U.S. student loan debt means today’s college graduates might not be as financially prepared for the future as their parents and grandparents. Delaying these life events also means that today’s college students can be in debt longer than their parents which can also cause them to delay retirement until they become debt-free or can afford to retire.

Delaying purchases can also affect other areas of the economy that depend on spending from college and non-college graduates. As college graduate spend a larger portion of their paycheck paying back student loans, they won’t spend as much in other sectors meaning some businesses will have fewer profits and potentially fewer employees.

While high student loan debt has the largest direct impact on the borrower, it also affects the entire economy.

Summary

Student loan debt in the U.S. is at a record high and will only continue to increase in the upcoming years. You shouldn’t completely avoid going to college to not go into debt. However, it’s important to know the potential impact of having high student loans. By financially preparing for college as soon possible, you can make wise decisions that can reap lifelong benefits.

Share this Image On Your Site

Disclosure: The information provided by The Financial Genie is for informational purposes only. It should not be considered legal or financial advice. You should consult with an attorney or other professional to determine what may be best for your individual needs. The Financial Genie does not make any guarantee or other promise as to any results that may be obtained from using our content. No one should make any investment decision without first consulting his or her own financial advisor and conducting his or her own research and due diligence. Additionally, some of the organizations with products on our site may pay us a referral fee or affiliate commission when you click to apply for those products.